May 04, 2011

A New Location Services based Class Action Lawsuit has been Filed against Apple. It's Time to Open up the Debate Wide Open

Cynthia O'Flaherty has filed a class action complaint against Apple and is seeking the court in Illinois to grant it class action status. The case rests on the plaintiff's view of Apple's patent 20110051665 titled "Location Histories for Location Aware Devices." The complaint uses incendiary wording and/or phrasing such as "Apple collected the private location information covertly, surreptitiously and in violation of law, "or "secretly-gathered private information" and even "stalking." This is not the first lawsuit against Apple on this front and it's likely not to be the last. In fact, there have been recent cases filed against Apple in Florida and Alabama. While our report presents the O'Flaherty case in depth, we also try to balance it with a look into the issue in general. Is Apple really the bogeyman or has conspiratorial hysteria been overblown? Are we the ignorant public or has the industry, Apple included, been too slow at providing us with real answers or solutions? At the end of the day, it's not a black and white issue and it's important for everyone to join in the conversation so that the public and the industry can try to find a middle ground between progress and privacy.

Introductory Note

Patently Apple presents the vast majority of the class action complaint filed by Cynthia O'Flaherty below untouched so that you could see the complaint for yourself. At the end of the complaint we'll present a few comments of our own on this matter and then open it up for you to join in via comments.

You could read the O'Flaherty case in its entirety, in part, or skip it to get to the debate. It's up to you – but at the end of the day, we ask that you try to participate in the conversation by expressing your opinion on this matter. Every opinion matters before Steve Jobs and others go before the Senate on May 10, 2011. Time is running out, so send in your comments and opinions as soon as you can.

Cynthia O'Flaherty: Class Action Complaint

Facts

Apple's iPhones and iPads are carried with users to essentially every location they travel to, making the information collected by Apple highly personal; indeed, in many instances it may be information to which employers and spouses are not privy.

All iPhones and iPads log, record and store users' locations based on latitude and longitude alongside a timestamp. These mobile computing devices store this information in a file named "consolidated.db", or a similarly named file. Apple intentionally began recording this information with the release of its iOS 4 operating system in June, 2010. Apple uses a cell-tower triangulation to obtain user location. Alternatively, Apple uses global positioning system (GPS) data to obtain user location.

Apple devices download the user location data to the user's computer when the mobile device synchronizes ("syncs") or shares data with the computer. The data is unencrypted on the mobile devices and also on users' computers that sync with those mobile devices.

Apple previously collected user location information through its applications, though not to the extent done by the iOS 4 operating system. In the iTunes terms of service, Apple explains that they "collect information such as occupation, language, zip code, area code, unique device identifier, location, and the time zone where an Apple product is used".

In its patent application for the iOS 4 operating system location-recording technology, Apple explained that the network information it collected could be accessed by an individual or an application to map the device user's location over time.

The network information can be converted to estimated position coordinates (e.g., latitude, longitude, altitude) of the location aware device. The position coordinates can be stored in a location history database on the location aware device or made accessible on a network. A user or application can query the location history database with a timestamp or other query to retrieve all or part of the location history for display in a map view.

The location history can be used to construct a travel timeline for the location aware device. The travel timeline can be displayed in a map view or used by location aware applications running on the location aware device or on a network. In some implementations, an Application Programming Interface (API) can be used by an application to query the location history database.

At this point, the Complaint states to "See U.S. Patent App. 20110051665." At the end of this report we show you how you could gain access to this patent for viewing. For now, see three key patent illustrations associated with Apple's patent application below.

The complaint continues by stating that: Users of Apple's iPhones and iPads, including Plaintiff and the putative Class, were unaware of Apple's tracking their locations.

Apple did not disclose that it comprehensively tracked its users in its terms of service. Plaintiff and other users did not provide any sort of informed consent to the tracking at issue in this case. Apple collected the private location information covertly, surreptitiously and in violation of law.

Apple collected and obtained Plaintiff's private location information by means of the operating system, by means of applications on Plaintiff's mobile devices and these mobile devices were serviced at Defendant's stores.

The accessibility of the unencrypted information collected by Apple places users at serious risk of privacy invasions, including stalking. Moreover, this secretly-gathered private information may be subpoenaed and become public in the course of any litigation, including divorce proceedings.

Plaintiff and the proposed Class members were harmed by Apple's accrual of personal location, movement and travel histories because their personal computers were used in ways they did not approve, and because they were personally tracked by a tracking device for which a court-ordered warrant would ordinarily be required.

Plaintiff and her proposed Classes suffered two different types of injuries. First, Plaintiff and her proposed Classes were injured and suffered a loss as a result of Apple's surreptitiously recording their customers' locations. Their private information was surreptitiously stored on their mobile devices and transferred, without their knowledge or consent, to other computers and to third parties. Second, Plaintiff and her Classes were injured by the risk of transfer of their location information to malicious third parties. By surreptitiously storing this information on their iPhone and transferring to other computers and to third parties by means of Apple Applications, Plaintiff and her proposed Classes face the risk of their private location information being obtained by malicious third parties and/or made public, for example, in the course of litigation. The damages incurred by Plaintiff and her proposed Classes exceed $5,000,000.00.

Count 1 – Computer Tampering

Plaintiff incorporates by reference all previous paragraphs of this Class Action Complaint as if fully as if fully set forth herein.

Class Allegations

Plaintiff's Class is defined as follows: all Illinois citizens who had a program or operating system installed on his or her iPhone or iPad by Defendant Apple that recorded their location surreptitiously, illegally and without their consent. Excluded from Plaintiff's Class are: (1) Defendant, its employees, and all persons who have or had a controlling interest in the Defendant corporation; (2) Defendants' legal representatives, predecessors, successors and assigns; (3) the judge who is assigned to this case and his/her immediate family; (4) Plaintiff's attorneys and their employees; (5) all persons who properly execute and file a timely request for exclusion from the class.

Plaintiff's proposed Class is comprised of thousands of Defendant's customers, the joinder of which is impracticable, and the members of the Class are so numerous that it is impractical to bring all of them before the Court in this action. Moreover, the amount of damages suffered individually by each member of the Class is so small as to make suit for its recovery by each individual member of the Class economically unfeasible.

Class treatment of the claims asserted herein will provide substantial benefit to both the parties and the court system. A well defined commonality of interests in the subject questions of law and fact affects Plaintiff and all proposed members of the Class.

There are common questions of law and fact applicable to the claims asserted on behalf of the Class. These common questions include but are not limited to:

(a) Whether Defendant knowingly and intentionally installed a program or operating system on the mobile computing device of Plaintiff and her proposed Class that altered, transferred and removed data;

(b) Whether Plaintiff and her proposed Class authorized Defendant to collect, alter and remove data from their mobile computing devices;

(c) Whether Plaintiff and her proposed class suffered a loss and incurred damages as a result of Defendant's collecting, altering and removing data from their mobile computing devices;

(d) Whether Defendant's actions were intentional, malicious and corrupt to such a degree to support an award of punitive damages.

These questions of law and fact predominate over any questions affecting only individual members of Plaintiff's class.

Plaintiff's claims are typical of the claims of the proposed Class, and Plaintiff will fairly and adequately represent and protect the interests of the proposed Class. Plaintiff does not have any interest antagonistic to those of the Class. Plaintiff has retained competent and experienced counsel in the prosecution of this type of litigation. The questions of law and fact common to the members of the Class, some of which are set out above, predominate over any questions affecting only individual members of the Class.

A class action is superior to other available methods for the fair and efficient adjudication of this controversy because members of the Class number in the thousands and individual joinder is impracticable. The expenses and burden of individual litigation would make it impracticable or impossible for proposed members of the Class to prosecute their claims individually. Trial of Plaintiff's claims is manageable.

Cause of Action

Illinois law provides:

(a) A person commits the offense of computer tampering when he knowingly and without the authorization of a computer's owner, as defined in Section 15-2 of this Code, or in excess of the authority granted to him:

(4) Inserts or attempts to insert a "program" into a computer or computer program knowing or having reason to believe that such "program" contains information or commands that will or may damage or destroy that computer, or any other computer subsequently accessing or being accessed by that computer, or that will or may alter, delete or remove a computer program or data from that computer, or any other computer program or data in a computer subsequently accessing or being accessed by that computer, or that will or may cause loss to the users of that computer or the users of a computer which accesses or which is accessed by such "program"[.] 720 ILCS 5/16D-3(a)(4). This law provides a civil cause of action for all individuals that suffer a loss by reason of violation of this provision 720 ILCS 5/16D-3(c). Violation of this law is a Class 4 felony for the first offense and a Class 3 felon for the second or subsequent offense. 720 ILCS 5/16D-3(b)(3).

Defendant Apple knowingly and without authorization installed a "program" or operating system on Plaintiff's iPhone, knowing or having reason to know that it would both alter, transfer and remove data from that mobile computing device, proximately causing Plaintiff and her proposed class to suffer a loss and incur damages in excess of $5,000,000.00.

Plaintiff's Class is defined as follows: all Illinois citizens who had a program or operating system installed on his or her iPhone or iPad by Defendant Apple that recorded their location surreptitiously, illegally and without their consent. Excluded from Plaintiff's Class are: (1) Defendant, its employees, and all persons who have or had a controlling interest in the Defendant corporation; (2) Defendants' legal representatives, predecessors, successors and assigns; (3) the judge who is assigned to this case and his/her immediate family; (4) Plaintiff's attorneys and their employees; (5) all persons who properly execute and file a timely request for exclusion from the class.

Plaintiff's proposed Class is comprised of thousands of Defendant's customers, the joinder of which is impracticable, and the members of the Class are so numerous that it is impractical to bring all of them before the Court in this action. Moreover, the amount of damages suffered individually by each member of the Class is so small as to make suit for its recovery by each individual member of the Class economically unfeasible.

Class treatment of the claims asserted herein will provide substantial benefit to both the parties and the court system. A well defined commonality of interests in the subject questions of law and fact affects Plaintiff and all proposed members of the Class.

There are common questions of law and fact applicable to the claims asserted on behalf of the Class. These common questions include but are not limited to:

(a) Whether Plaintiff and the putative Class were consumers of Defendant's merchandise, and whether they bought Apple's merchandise for personal or family use;

(b) Whether surreptitiously gathering, obtaining and transferring private location information without user authorization is an unfair business practice that violates the Illinois Consumer Fraud and Deceptive Business Practices Act;

(c) Defendant Apple omitted, concealed and suppressed the material fact that it collected, obtained and transferred the private location information of Plaintiff and her proposed Class;

(d) Whether Defendant acted with the intent for Plaintiff and the putative Class to rely on its omission, concealment and suppression;

(e) Whether Plaintiff and the putative Class suffered damages as a proximate result of Defendant's actions;

(f) Whether Defendant's actions were intentional, malicious and corrupt to such a degree to support an award of punitive damages. These questions of law and fact predominate over any questions affecting only individual members of Plaintiff's Class.

Plaintiff's claims are typical of the claims of the proposed Class, and Plaintiff will fairly and adequately represent and protect the interests of the proposed Class. Plaintiff does not have any interest antagonistic to those of the Class. Plaintiff has retained competent and experienced counsel in the prosecution of this type of litigation. The questions of law and fact common to the members of the Class, some of which are set out above, predominate over any questions affecting only individual members of the Class.

A class action is superior to other available methods for the fair and efficient adjudication of this controversy because members of the Class number in the thousands and individual joinder is impracticable. The expenses and burden of individual litigation would make it impracticable or impossible for proposed members of the Class to prosecute their claims individually. Trial of Plaintiff's claims is manageable.

Cause of Action

Plaintiff and the members of her proposed Class were consumers of Apple's merchandise, and they bought the subject mobile computing devices for personal or family use.

The Illinois Consumer Fraud and Deceptive Business Practices Act provides:

Unfair methods of competition and unfair or deceptive acts or practices, including but not limited to the use or employment of any deception, fraud, false pretense, false promise, misrepresentation or the concealment, suppression or omission of any material fact, with intent that others rely upon the concealment, suppression or omission of such material fact, or the use or employment of any practice described in Section 2 of the "Uniform Deceptive Trade Practices Act", approved August 5, 1965, in the conduct of any trade or commerce are hereby declared unlawful whether any person has in fact been misled, deceived or damaged thereby.

By surreptitiously installing a program on the mobile computing devices of Plaintiff and her proposed Class that recorded their location without their consent, Defendant Apple engaged in an unfair business.

Defendant Apple omitted, concealed and suppressed the material fact that it collected, obtained and transferred the private location information of Plaintiff and her proposed Class, and Defendant acted with the intent for Plaintiff and the putative Class to rely on that omission, concealment and suppression.

Defendant's violations of the Illinois Consumer Fraud Act occurred in the course of trade or commerce, and Plaintiff and her putative Class incurred damages in excess of $5,000,000.00 as a proximate result of Defendant's actions.

The case was filed in the United States District Court for Southern District of Illinois Eastern Division. The presiding Judge in this case is noted as being Judge Michael J. Reagan. To review patent application 20110051665, simply feed that number into this search engine.

Dispelling Conspiracies and the Bogeyman

Hysteria is quite the modern day phenomena on the web; someone decides to kick up a dust storm of controversy and the sheep go mad. A report by O'Reilly's Radar titled Apple is recording your moves stirred up a hornets' nest and sometimes that's good.

In this particular case, it actually forced Apple to make a statement that there was indeed a bug in their location based software that appears to have been gathering tracking information on your iPhone for a year and that it should have been set for something like seven days. Even though that contradicts Apple's patent which discusses tracking carried out "over time" – which is likely more than 7 days, I'll give Apple the benefit of the doubt because the statement is current and that the patent is well, just that, a patent. Apple has the right to make decisions on the fly as the market conditions demand and patents provide that flexibility to adapt to current times within the spirit and scope of the patent.

But then there are reports like the one from Gawker titled "Apple Patent Reveals Extensive Stalking Plans." It's a hysterical view that tries to paint and/or spin a conspiracy theory based on an open-to-the-public-patent for heaven's sake. It twists simple patent terminology like "remote servers" into a stalking server.

Imagine that - a tech writer who doesn't get the basic fundamentals of "cloud computing" or "cloud services." Apple openly promotes modern wireless services like "Maps + Compass" or "Find My iPhone." Apple also offers a way to tag photos that will of course use GPS tracking to execute that feature. And of course it will use cloud computing (servers) to accomplish this task just like everyone else's tracking programs in the business is doing. The term "remote server" shouldn't be seen as a bogeyman tool: That's simply sheer nonsense.

Another silly example from Gawker's report points to "financial transactions" and these scary "remote servers." Yes, Apple looks forward when crafting their patents and the concept of the iWallet or e-Wallet has been discussed for some time now. Thank goodness that someone is thinking ahead so that there's a financial transaction record that could be tracked or traced if your iPhone or iPad gets lost or to simply remind you where you made your last deposit and so forth. There is no bogeyman financial transactions server out there that's out to get you: ha!

Apple's Scott Forstall, Senior VP of iPhone Software discussed location services in depth as Apple was rolling out this product and/or service. It was made crystal clear at that time that the user could easily turn off location services and thereby cease all tracking capabilities of the device and/or service. We covered that event and particularly that subject over a year ago because we knew that this could be an issue going forward.

So it's a little hard for me to swallow that someone who really wants to buy an iPhone wouldn't first look into the features of the device and look at the software that it offers as is fully laid out in depth on Apple's website. On several webpages Apple clearly points to apps that would use tracking, like Compass + Maps. How else could the iPhone direct a user on a map without using some form of tracking mechanism? So being oh-so shocked about tracking functions and suing over it rings disingenuous to say the least.

Yet Questions Remain and Better Solutions are Needed

I don't want to make it like I'm not concerned over privacy because I most definitely am. I personally go out of my way to make sure that I don't give out too much private data to companies and try to limit the information wherever possible. I also go out of my way to flag patents that are making statements that raise my eyebrow legitimately. One such example is a patent that goes well beyond location services and into the territory of user profiling. With Apple's new iAd business, we could see that there might be a conflict of interest brewing when it comes to gathering user profiling information. Apple may keep that private – but then they shouldn't be surprised when it raises concerns in the public.

At the end of the day, bloggers try to point out facts that we may see as troubling. Even Gawker may have tried to do this – but simply overplayed their hand so as to plug into the frenzy that broke out on this subject. We all get a little off-course sometimes when covering a hot topic. But there has to be a balance of keeping Apple's feet to the fire and yet understanding that there's legitimate reasoning for why location services exist in the first place. If your child got lost and had an iPhone with location services on it, the authorities would likely be able to track your child down quickly and hopefully keep them from harm's way. Is that evil? No – of course not.

On the other hand, Apple's black and white solution of turning location services off or keeping them on is overly simplistic to a fault. Firstly, location services should ship with iOS devices turned off, not on. Let savvy users turn it on if they want but keep newbies comfortable by shipping it turned off. That's simple and should be done.

Yet, this is new for Apple too and we the users have to state that we want more choices on which location services we want to open up and which ones we want shut off. It's unfair for Apple to put us in a situation of take it all or lose it all. I may want Apple's "Places" based location services for photos but I may not want my every move tracked for social networking purposes so that friends could track me down. Meaning - that Apple has to create a superior interface in the iOS settings area of our devices that provides us with a list of services to turn on or off. When we're faced with a take or leave it choice, it'll force some of us to turn it on knowing full well that we really don't want every location based service made available to us. Apple shouldn't force us into that limited situation.

At the end of the day we're likely to hear more from Apple and others in the industry when they go before the Senate to discuss location based services. We definitely hope to hear honest answers and not a lot of marketing slogans or excuses that we the public are just too stupid to understand. We hope that the scope of the debate also covers the topic of user profiling that is being considered for future devices.

Companies like Apple and Google who own Ad companies have a vested interest in tracking more information about us than they should be able to gather and we'll likely need stiffer laws to ensure that these companies will face harsh legal consequences if they cross the line.

But we're not there yet and not even close. So until things get ironed out, calling up the bogeyman to scare the public so as to justify class action lawsuits is pathetic while being expected. What we need is to get consumers to articulately voice their opinions loud and clear so as to assist the Senate in asking the right questions that meet our concerns. So please, get involved with commenting below and let's hear what's on your mind.

Notice:Patently Apple presents only a brief summary of certain legal cases/ lawsuits which are part of the public record for journalistic news purposes. Readers are cautioned that Patently Apple does not offer an opinion on the merit of the case and strictly presents the allegations made in said legal cases / lawsuits. A lawyer should be consulted for any further details or analysis.About Comments:Patently Apple reserves the right to post, dismiss or edit comments. On most legal cases, comments will be closed. See our Legal Archives for other patent infringement cases.

Comments

This lady is an opportunits that wants to win the lotto without buying any ticket. There will be no free lunch from Apple to all these people. The collection of user data is in the TOS and there is no secrecy in this service, since there is a switch to turn the service off in the iPhone settings.

@David. Obviously you're a true blue appleguy. Some of us don't like that there are Apple patents describing profiling and tracking in great detail. Some of us want to know about what is a user profile so that they could custom market things to us. What is Apple sharing? I doubt that you know. You're just blindly following Apple. This is too big an issue to base it all on trust. This is a huge social issue where the secrecy has to stop and honesty has to be forthcoming. I hope that the Senate could force answers out of the leaders that were invited there.

This new lawsuit on the other hand is where I could agree with you David.

Perhaps I am missing something? Location Services is not an "all or nothing" issue in it's current implementation on the iPhone. You have the ability to designate which applications you want to use Location Services. For example, I let Maps use it, but not Facebook. The list of all applications that can leverage location services is displayed in Settings/Location Services and you can choose which ones you want to have access to that type of data.

@Mark. Thanks for that answer. Apple still ships with location services on though. Changing locaton services to "off" out of the factory would put a lot of these complaints to rest. Though in this case the plaintiff is pointing to the database file. That's another issue but one that Apple said that they would be addressing shortly

The first time you use an app that needs location services, iOS does ask if you want to turn it on for that app. I believe, even Maps did so the first time (that was a long time ago for me.) So apps do arrive in the default state of off.

The case is relying on the provisions in the Illinois law that gives them wiggle room to actually grant this class action. Then the games really begin. You have an Irishman here so it's bound to go nine rounds.

I doubt that Steve Jobs will show up at the Senate hearing. He'll send Forstall. But it could be interesting if the Senate questions are (a) live on TV and not edited and (b) intelligent questions that actually put these tech giants on the ropes to answer truthfully. It's bound to be a circus no matter what.

The case talks about a divorce scenario that is theorectical. How is that even allowed in a case?

On the point of shipping products with location services off, I agree with you wholeheartedly. Then when I want to use a service that needs it, a dialog window could pop up to give me the option to turn that particular service on at that time where it makes sense to me. I don't think you need a list if Apple is forced to ask your permission to turn on a service for each new application. Newbies would understand this better than a list of choices they wouldn't understand anyways.

I like the idea of being able to turn off and on various location services. This has to be an idea that Apple will implement. It's a real solution. I too may like it for photos but for a future iWallet? I don't think so until I'm more comfortable with the security of all of this. When it comes to my money, e-banking is not for me. But why should I lose location services for one service if I don't want another service like banking. That's why adding choice makes a lot sense and it would really be easy for Apple to implement.

I have an iPod touch and was surprised to know that a softare update added location services to my settings. Why? It wasn't there when I bought the iPod. It's an iPod. How can they track me? I don't get this.

Another scam artist trying to rip Apple off. This case has zero merit. Want to use a Location Services app? Turn on Location Services. Don't want the phone to know where you are though - gotta keep that secret - well, you need to consult your One Hand Clapping Mumbo Jumbo Manual for that one. It's going to be hard to find the nearest Exxon gas station if the phone doesn't know where you are, so good luck with that idea.

On the other hand, if you never want to use a Location Services app, turn Location Services off. End of story.

This is just the tip of the iceberg for legal cases. Maybe the guys over at 60 Minutes could do a series of investigative reports on this subject. We need a huge investigative team and newsworthy show to showcase this topic from all sides. I don't trust big tech.

I turn off location services. Yet will the iWallet really use tracking? I want the iWallet but this is where I might get a little paranoid. Banking info is the ultimate data you want protected and not subject to discovery by tracking or by anyone. Interesting times ahead.

I think we could be headed for a real headache with these new services flying out like the wild wild west. Companies are making up rules any way they want and hide or complicate details buried in multiple terms and condition clauses and other areas that the public never really gets to read. These companies bank on your rush to download free software and not reading their clauses about privacy or tracking.

Law makers are old and will never be able to keep up with these tracking services hidden in software. If this really opens up, you'd never want to buy an iPhone or android phone. And the Senate will only pretend to look all concerned. but to keep jobs, it's just a dog and pony show. Big businesses like Apple will go unchallenged and if something is done, it'll be too late for most of us using iPhone's today anyways.

All these new services available now and the iwallet of tomorrow are starting to concern me a little. I want the services but I don't really know what my device or 3rd party apps could do with information on my iPhone. If they don't explain to me what they're gathering or what 3rd parties could gather, I may have to limit which apps and services I use in the future, which is kind of a joy kill. It's definitely a creepy subject if you think about it.

I agree. I think we should have more options for location based services on our devices. Some services I want and others I don't. Good point.

Also, Steve Jobs should have known better than this. He's a meticulous man and pretending that he's surprised at the reaction to tracking is surprising in itself. I do get creeped out on this issue and you're right, it has to be brought out and discussed loudly so that we all feel more comfortable about these new trackiing capabilities. It's not just Apple's devices but how hackers could tap into databases like these on our iPhones etc.